Property Market Information: Auctions and prices remain steady

By the resi financial blog team, 02 October 2014

Amidst calls from the Reserve Bank of Australia (RBA) to assess how "hot" the property market is, buyers seem to be carrying on unperturbed. Auctions this last week continued to show the strength of the market, and the willingness of buyers to pay the going rate for a property in Sydney, Melbourne or anywhere else. It is important to remember that the people bidding at these auctions are unconditional bidders, who will have already arranged their finance, whether it's their first home loan or refinancing to invest - these buyers are prepared to meet the market.

With national auction clearance rates over 70 per cent for the week ending September 28, according to RP Data, there is no doubt that buyers are prepared to pay market rate for properties offered at auction. Even the most expensive parts of the country did well this last weekend, with Sydney having a clearance rate of 76.9 per cent, and Melbourne claiming top of the pile with 77.3 per cent of all reported auctions being sold.

The good news for buyers as they prepare their finances is that prices have remained steady across September, according to RP Data. A national increase in prices over September of around 0.1 per cent means that capital gains for the quarter have been at 2.9 per cent. With the two months previous recording drastic increases in prices, buyers will be happy to know that the market has swung in their favour for a time.

Although Sydney and Melbourne reported relatively high capital gains for the quarter, 4.1 per cent and 3.7 per cent respectively, the RBA should be pleased with a slower September quarter across the board. Although buyers are willing to pay market price, it seems that for now the market isn't asking too much.